Download or read book Stockholm School of Economics Working Paper Series in Economics and Finance Why Agency Costs Explain Diversification Discounts written by and published by . This book was released on with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Presents " Why Agency Costs Explain Diversification Discounts," paper number 294 in the Working Paper Series in Economics and Finance of the Stockholm School of Economics in Sweden. Examines links between agency costs associated with private ownership and diversification discounts within a single industry.
Download or read book Related Diversification Agency Costs and Share written by Henrik Cronqvist and published by . This book was released on 1998 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Working Paper Series written by and published by . This book was released on 1999 with total page 562 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The Control of Corporate Europe written by Fabrizio Barca and published by OUP Oxford. This book was released on 2001-11-15 with total page 354 pages. Available in PDF, EPUB and Kindle. Book excerpt: Written by an international team of authors, this book provides the first systematic account of the control of corporate Europe based on voting block data disclosed in accordance with the European Union's Large Holdings Directive (88/627/EEC). The study provides detailed information on the voting control of companies listed on the official markets in Austria, Belgium, France, Germany, Italy, the Netherlands, Spain, Sweden, the United Kingdom, and, as a benchmark comparison, the United States. The authors record a high concentration of control of corporations in many European countries with single blockholders frequently controlling more than fifty per cent of corporate votes. In contrast, a majority of UK listed companies have no blockholder owning more than ten per cent of shares, and a majority of US listed companies have no blockholder with more than six per cent of shares. Those chapters devoted to individual countries illustrate how blockholders can use legal devices to leverage their voting power over their cash-flow rights, or how incumbents prevent outsiders from gaining voting control. It is shown that the cultural and linguistic diversity of Europe is (almost) matched by its variety of corporate control arrangements.
Download or read book Why Agency Costs Explain Diversification Discounts written by Peter Högfeldt and published by . This book was released on 2008 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: We study diversification within the real estate industry because of its relative transparency: portfolio management of assets with well-defined market prices. Diversification is over property types and geographical regions. The major cause of the diversification discount is not diversification per se but anticipated costs due to rent dissipation in future diversifying acquisitions. Firms expected to pursue non-focusing strategies do indeed diversify more; are valued ex ante at a 20% discount over firms anticipated to follow a focusing strategy; are predominantly privately controlled and extensively using dual-class shares. The ex ante diversification discount is therefore a measure of agency costs.
Download or read book Why Agency Costs Explain Diversification Discounts by Henrik Cronqvist Peter H gfeldt and Mattias Nilsson written by Henrik Cronqvist and published by . This book was released on 1999 with total page 44 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book The cost of diversity written by Raghuram G. Rajan and published by . This book was released on 1998 with total page 50 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Journal of Financial Intermediation written by and published by . This book was released on 2004 with total page 586 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Handbook of the Economics of Finance written by G. Constantinides and published by Elsevier. This book was released on 2003-11-04 with total page 698 pages. Available in PDF, EPUB and Kindle. Book excerpt: Arbitrage, State Prices and Portfolio Theory / Philip h. Dybvig and Stephen a. Ross / - Intertemporal Asset Pricing Theory / Darrell Duffle / - Tests of Multifactor Pricing Models, Volatility Bounds and Portfolio Performance / Wayne E. Ferson / - Consumption-Based Asset Pricing / John y Campbell / - The Equity Premium in Retrospect / Rainish Mehra and Edward c. Prescott / - Anomalies and Market Efficiency / William Schwert / - Are Financial Assets Priced Locally or Globally? / G. Andrew Karolyi and Rene M. Stuli / - Microstructure and Asset Pricing / David Easley and Maureen O'hara / - A Survey of Behavioral Finance / Nicholas Barberis and Richard Thaler / - Derivatives / Robert E. Whaley / - Fixed-Income Pricing / Qiang Dai and Kenneth J. Singleton.
Download or read book Agency Costs Risk Management and Capital Structure written by Hayne E. Leland and published by . This book was released on 1998 with total page 45 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Corporate Restructuring written by Bjørn Espen Eckbo and published by Now Pub. This book was released on 2013-07 with total page 144 pages. Available in PDF, EPUB and Kindle. Book excerpt: We survey the empirical literature on corporate financial restructuring, including breakup transactions (divestitures, spinoffs, equity carveouts, tracking stocks), leveraged recapitalizations, and leveraged buyouts (LBOs). For each transaction type, we survey techniques, deal financing, transaction volume, valuation effects and potential sources of restructuring gains. Many breakup transactions appear to be a response to excessive conglomeration and attempt to reverse a potentially costly diversification discount. The empirical evidence shows that the typical restructuring creates substantial value for shareholders. The value-drivers include elimination of costly cross-subsidizations characterizing internal capital markets, reduction in financing costs for subsidiaries through asset securitization and increased divisional transparency, improved (and more focused) investment programs, reduction in agency costs of free cash flow, implementation of executive compensation schemes with greater pay-performance sensitivity, and increased monitoring by lenders and LBO sponsors. Buyouts after the 1990s on average create value similar to LBOs of the 1980s. Recent developments include consortiums of private equity funds (club deals), exits through secondary buyouts (sale to another LBO fund), and evidence of persistence in fund returns. LBO deal financing has evolved toward lower leverage ratios. In Europe, recent deals are financed with less leveraged loans and mezzanine debt and more high-yield debt than before. Future research challenges include integrating analyses across transaction types and financing mixes, and producing unbiased estimates of the expected return from buyout investments in the presence of limited data on portfolio companies that do not return to public status.
Download or read book Agency Costs Firm Behaviour and the Nature of Competition written by Philippe Aghion and published by . This book was released on 1999 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Geographic Diversification and Agency Costs of Debt of Multinational Firms written by John A. Doukas and published by . This book was released on 2008 with total page 47 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the agency conflicts between shareholders and bondholders of multinational and nonmultinational firms and provides an explanation for the puzzle that multinational firms use less long-term debtbut more short-term debt than domestic firms. Using a sample of 6,951 firm-year observations for multinational and domestic firms over the 1988-1994 period, we find that alternative measures of agency costs havestatistically significant negative effects on firm long-term leverage. The results, however, also show that the negative effects of agency costs of debt on long-term leverage are significantly greater for multinational than non-multinational firms. It is documented that the effect of the agency costs of debt on leverage are increasedby the firm s degree of foreign involvement. The evidence shows that firm s increasing foreign involvement exacerbates agency costs of debt leading to lower (greater) use of long-term (short-term) debt financing. Thisresult is also confirmed using alternative measures of foreign involvement. The evidence is consistent with the view that multinational corporations are susceptible to higher agency costs of debt than domestic corporations because geographic diversity renders active monitoring more difficult and expensive in comparison to domestic firms. The results fail to support the view that MNCs lower long-term debt ratios are due to the advantages of the internal capital markets.
Download or read book Product Market Competition and Agency Costs written by Jennifer Jane Baggs and published by . This book was released on 2006 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Behavioral Corporate Finance written by Hersh Shefrin and published by College Ie Overruns. This book was released on 2017-04-16 with total page 300 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Closed End Fund Discounts in a Rational Agent Economy written by Matthew I. Spiegel and published by . This book was released on 2000 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: Nearly any standard financial model concludes that two assets with identical cash flows must sell for the same price. Alas, closed-end mutual fund company share prices seem to violate thisfundamental tenant. Even when one considers several standard frictions, such as taxes and agency costs, classical financial models cannot explain the large persistent discounts foundwithin the data. While the standard financial markets model may not explain the existence of large closed-end fund discounts, this paper shows that a rather close version of it does. In anotherwise frictionless market, if asset supplies vary randomly over time and agents posses finite lives a closed-end mutual fund's stock price may not track its net asset value. Furthermore, the analysis provides a number of conditions under which these discrepancies will lead to the existence of systematic discounts for the mutual fund's shares. In addition, the model provides predictions regarding the correlation between current closed-end fund discounts and current changes in stock prices and future changes in corporate productivity. As the analysis shows the same parameter values that lead to systematic discounts also lead to other fund price characteristics that resemble many of the results found within empirical studies.
Download or read book Agency costs mispricing and ownership structure written by Sergey Chernenko and published by . This book was released on 2010 with total page 35 pages. Available in PDF, EPUB and Kindle. Book excerpt: Standard theories of corporate ownership assume that because markets are efficient, insiders ultimately bear agency costs and therefore have a strong incentive to minimize conflicts of interest with outside investors. We show that if equity is overvalued, however, mispricing offsets agency costs and can induce a controlling shareholder to list equity. Higher valuations support listings associated with greater agency costs. We test the predictions that follow from this idea on a sample of publicly listed corporate subsidiaries in Japan. When there is greater scope for expropriation by the parent firm, minority shareholders fare poorly after listing. Parent firms often repurchase subsidiaries at large discounts to valuations at the time of listing and experience positive abnormal returns when repurchases are announced.
